Monday November 11, 2013 - 03:48:20 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 11-Nov-2013 -0346 GMT
Dow (15761.78, +167.80) bounced sharply towards the upper boundary of the 1000 point range it has been moving for the last few months. A rally above 15850 can take it fast to the major resistance area of 16100-200. Major support remains at 15500 levels. Nasdaq (3919.23, +61.90) has created a Bullish Inside bar. Above 3938-56, it can rally further.
Dax (9078.28,-2.75) is bouncing well. If it can stay above the major support of 8950, it can reach 9120 soon.
Nikkei (14274.47, +187.67) has moved up sharply from our target support zone of 14000. We may see it targeting 14800 if the current uptrend holds. Shanghai (2103.98, -2.15) has fallen below the support at 2100. We see it testing the 21-MA support on the weekly which may help it to bounce back to 2150.
Nifty (6140.75) has confirmed a weekly downtrend. The important support to watch is 6080-6120 below which we can see a major fall. Resistance lies at 6170-90.
Gold (1284.90, +0.30) fell sharply below the support at 1290 and is now testing support at 1275. If the support fails to hold we may see it falling towards 1250-1225. Silver (21.32, 0.00) remained stable and is consolidating sideways. We may see it testing the near term support at 21.
Copper (3.2615, +0.0075) is up but it continues to be ranged in the 3.20-3.35 region.
Nymex WTI (94.76, +0.16) is up from the support area of 92.70-93. We see it ranged at 94-96 for the next few days. Brent (105.61, +0.49) is up and is coming up to a resistance near 106. A break above 106 and we may see it testing 108.
Euro (1.3357) failed to go above the major resistance of 1.3450-60 mentioned before and dropped near the earlier low. Below 1.3295-1.3318, it can fall to 1.3150-1.32. Holding 1.3318, it can try to rally once more towards 1.3390 & 1.3450. Dollar Index (81.26) is still looking strong but to keep the rally intact, it needs go above 81.52. Failing to do that, it can correct a bit to 80.60-80.80.Major support is at 80.75-81 and resistance at 81.75-82.
Dollar-Yen (99.03) once again got rejected from the main resistance area of 99.80-90. Above 99.80 and then 100.70, we could expect a long trending move to emerge which could take it above 104 and a lot more. Support is at 98.80 and 98.25. EURJPY (132.26) gave a nice bounce from the October low of 131.20 levels in line with our expectation. The important level is 132.60 now, above which it can reach 133.20-50. But staying below 132.60 will bring the weakness back.
Pound (1.6014) dropped to 1.5957 when it failed to clear the strong resistance area around 1.6120 mentioned last week. Resistance is at 1.6060-70 and support is at 1.5950-80.
Aussie (0.9380) continues its fall. It is currently consolidating in a range of 0.9365-0.9395 but looks set for more downside. Major support is at 0.9280-85 and major resistance is at 0.9420-30.
USDINR (62.47) can open with a strong gap up today near 63 on the back of the sustained strength of Dollar Index and the weakness of the other emerging market currencies like Brazilian Real (2.3235). As the weekly trend remains up, the intraday and intra week dips are expected to be bought into. Resistance is at 63 and support is at 62.30-40. If it sustains above 63 it may try to reach our target of 63.70.
Yields are up globally.
US 10Yr (2.75%) has moved up sharply after the US NFP data. Will this bullishness continue or is it just a small rise before a big fall needs to be seen. Japan 10Yr (0.59%) has also moved up, bringing the US10-Y10 yield differential to 2.16%.
The German 10Yr (1.76%) has moved up with a corresponding fall in the Euro (1.3356). The UK 10Yr (2.76%) is also up. We may see it moving up to 2.80% in the next few days.
Indian 10Yr GOI (8.99%) has moved past our target of 8.90% within days of SBI and HDFC raising their lending rates. The rise in the Government yields may result in higher interest rates for public and corporate borrowers. The CPI and IIP data are due tomorrow which may affect the yields largely.
Chattisgarh Elections - - -
UK Trade Balance
...Actual -9.82 £ (Bln) ...Previous -9.63 £ (Bln) ...Expected 9.10 £ (Bln)
...Expected 126.00 K ...Previous 163 K ...Actual 204 K
US Unemployment Rate
...Expected 7.30 % ...Previous 7.20 % ...Actual 7.30%
US Personal Income
...Expected 0.30 % ...Previous 0.46 % ...Actual 0.47%
US PCE Price Index M/M
...Expected 0.30 % ...Previous 0.35 % ...Actual 0.18 %
CA Labour Force
...Expected 12.70 K ...Previous 11.90 K ...Actual 13.20 K
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